Microsoft Dynamics 365 Supply Chain Management

Automated warehouse tailored to your operational rules

Inbound processing, putaway, transfers, picking, packing, and shipping can all follow predefined rules. Dynamics 365 Supply Chain Management creates warehouse work tasks and determines their sequence. Warehouse workers can utilize a mobile app, barcodes, RFID, and other supported technologies. Automating warehouse operations and connecting to automated equipment accelerates processes and reduces manual data entry.

Multiple warehouses, zones, and storage methods

The ERP system allows you to manage multiple warehouses, zones, and locations with specific rules for receiving, storing, replenishment, and picking. Settings can be customized to the product type, inventory turnover, or shipping method, and leveraged when expanding your warehouse network.

Inventory management and valuation

You can track inventory by inventory dimensions, locations, pallets, batches, and serial numbers. It also includes inventory valuation based on your chosen method, such as FIFO, weighted average, or standard cost. Thanks to integration with purchasing, manufacturing, and planning, you gain full visibility into inventory quantity, location, and value, allowing for better replenishment management.

Inventory counts tailored to your operations

In addition to traditional physical inventory counts, the system supports cycle counting, where selected items or warehouse locations are continuously verified. This allows inventory audits to align seamlessly with daily warehouse operations.

Quarantine and quality control

Quarantine orders allow you to segregate materials or goods awaiting quality inspection or compliance with defined conditions. After inspection, inventory can be released or designated for further processing. This is particularly crucial during raw material receipt, purchased material inspection, and in operations with higher quality and traceability requirements.

Manufacturing tailored to your business model

Dynamics 365 Supply Chain Management supports discrete, process, and lean manufacturing. You can work with production orders, bills of materials (BOMs), routes, and production resources.

The production process can be managed using various strategies, such as make-to-stock, make-to-order, or configure-to-order. As a result, the solution fits both repetitive high-volume manufacturing and companies where the product or production process is customized to a specific order.

Production planning based on materials and capacity

MRP and master planning align production requirements with material availability, inventory, and capacity. The system helps determine what needs to be produced, purchased, or replenished—and when.

Planners can work with different production scenarios and react to shifts in demand or material availability. Microsoft highlights the ability to execute complete MRP runs in minutes, enabling more frequent planning updates.

Real-time manufacturing visibility

Information from the shop floor feeds back into the ERP, seamlessly linking to planning, inventory, and downstream processes. Production workers can access real-time data regarding operations and their status.

The solution can also be integrated with other technologies used in production, including IoT and MES systems, ensuring data does not remain siloed from the ERP. Microsoft also emphasizes support for the connected factory and leveraging IoT for faster deployment of new manufacturing processes.

Purchasing aligned with planning and inventory

From receipt to the end customer

Traceability allows you to track the origin and movement of materials or products by batch, serial number, or vendor batch number. You can identify where a material came from, its current location, which production run it was used in, or which customers received it—supporting both backward and forward tracking.

In the food industry, it helps track production batches from raw materials to distributors; in pharmaceuticals and chemicals, it tracks specific lots or batches; and in automotive, it tracks components used within a finished product or production order.

Data for quality, claims, and ESG

Inventory movement history simplifies claims management, product recalls, quality audits, compliance checks, and non-conformance resolution. The same data can serve as a foundation for ESG reporting, such as evaluating material origins, supplier practices, and supply chain impacts.

For manufacturing and distribution companies, traceability is more than just tracking inventory movements—it accelerates root-cause analysis, determines the scope of affected products, and provides actionable data for quality control, risk management, and sustainability.